In 1947 the Iranian Tobacco Company insured their employees against health expenditure and health services. The first Labour Social Insurance law was legislated in 1952 when the Labour Social Insurance Organisation officially became part of the Ministry of Work and Social Services. In 1974, the Ministry of Social Welfare was created to coordinate the previously dispersed activities relating to social welfare. The Social Security Law expanded the supportive services provided by insurance companies and made it compulsory for all workers to get insurance coverage from the Social Security Organisation in 1975.
In 1979, the Iranian parliament merged the Ministry of Social Welfare into a Ministry of Health and renamed it the Ministry of Health and Welfare, with the Social Security Organisation also being placed under the management of this new Ministry. This organisation was renamed the Social Security Insurance Organisation (SSIO) in 1980 to emphasise the importance of the health insurance services. The SSIO currently covers more than 27 million people (36% of the Iranian population) across the country. Almost all of its customers are workers and employees in the private sector where coverage is compulsory by law. It has two specific features which make it different from other health insurance organisations. First, its financing system is mainly independent from the government providing it with more freedom to manage its sources and services. A total of 30% of the employee’s wages is paid in the following proportions: government, 3%; employee, 7%; and employer 20%. One-third of this premium is for supporting health and two-thirds supporting pensions.
Secondly, the organisation has two service departments that work alongside each other; the pensions department and the health department. The Health department acts as both a provider and a consumer of health care services. As a provider it provides services in its health centres and hospitals which are free of charge for SSIO insured people. As a consumer, the organisation is to pay 90% of inpatient and 70% of outpatient costs to health care providers who are contracted to the organisation; but it is now failed to meet these requirements.
Imdad (Relief) Committee Health Insurance (ICHI) is a charity based health insurance body that was established shortly after the 1979 revolution to provide the basic level of insurance coverage for poor citizens who cannot afford to pay any insurance premium. Around 20% of its revenue comes from charitable donations and the government provides the rest. ICHI currently covers about 4.5 million disadvantaged people.
The Public Health Insurance Law in 1994 sought to cover nearly 60 percent of uninsured Iranian population. The Medical Services Insurance Organization (MSIO) was created based on this law in October 1994 to cover a wide range of individuals within five years. These included governmental employees and all individuals of the community with various socioeconomic levels that were not eligible to be covered by other health insurance organisations. From the introduction of MSIO the proportion of the population covered by health insurance increased from 40% in 1994 to about 90% in 2010. This is while the number of the population also has increased from 57.7 million in 1994 to 74.7 millions in 2010. This increase has happened mainly in rural areas, where the ability to pay is more likely to be lower than urban areas. However, the target of full coverage of the population has not been met yet. MSIO is now the largest health insurance organisation in Iran, covering 39 million people.
MSIO has various types of insurance policy, with the premiums being dependent mainly on a per capita rate for health care (PCHC). Determination of the PCHC is one of the main duties of higher insurance council.
Governmental employees, those in rural areas and specific groups such as students receive government subsidies. Table 2 shows the insurance accounts of MSIO and the level of subsidies that various groups receive.
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